Daily News headline

Obama’s
mortgage unit is AWOL

The title of the New York
Daily News op-ed tells much of the depressing story. Almost three months
after President Obama’s announced his latest plan to relieve struggling
homeowners, two activists sought out New York Attorney General Eric Schneiderman
who was appointed by President Obama to co-chair a new mortgage relief task
force.

Mindful of Schneiderman’s
reputation for standing up to pressure from the Obama administration, the
authors of the op-ed, Mike Gecan and Arnie Graf, were among many who hoped that
at long last, the president was indeed serious about “speeding assistance to
homeowners.”The authors remind us that
there are reportedly 12 million homeowners who are a collective $700 billion
underwater. We also learn that this latest task force, called the Residential
Mortgage Backed Securities Working Group, is the sixth such mortgage task force
created since Obama took office in 2009.

Their sad, but
unsurprising, finding is that Obama’s use of the word “speed” is belied by
contrary information. Interviewing Schneiderman in early March and then again in
early April, the authors learned that the attorney general had traveled
especially to Washington twice to oversee his task force responsibilities. Both
times he found that there was “no office, no phones, no staff and no executive
director
for his task force.” The authors report that the total staff hired in all
five previous groupswas ONE.

As we stand in awe at the administration’s
brazen chutzpah, it would seem difficult to exaggerate the implications of
Obama’s inaction on an issue so fraught for the economy and for his
re-election--but I’ll try. Obama’s handling of the mortgage issue is part of a
larger pattern of willful neglect and is consistent with policies that suggest
little or no White House interest in spurring the larger economy.

Chief among those polices has been President
Obama’s continuation of the ruinous tax cuts of the previous
administration. Writing for Z
Magazine, (April 2012) Jack Rasmus points out that Obama cut $300+ billion
in taxes in 2009 and another $802 billion in 2010 (who knew?). At the same time,
before the advent of the Occupy movement, he used his bully pulpit to echo
Republican calls for austerity and deep budget cuts. (Among all the damaging
reductions to non-military spending overseen by the president, is it too
frivolous to point to current plans to strip PBS of significant funding for
some of its most popular cultural and political
programming?)

A depressed economy
predictably means trouble for the incumbent and his party. Thus the Obama
administration’s pursuit in early 2009 of a relatively small stimulus designed
to largely peter out by the end of 2010 and riven with tax cuts suggests that
the large losses of Democratic Congressional seats in the fall 2010 elections
may very well have been a case of failure by design.

Could it be that Obama is
only pretending to be a Democrat? Is it possible, as Oliver Stone charged in
January 2012 (in connection with Obama’s wars and his attacks on
Constitutionally protected freedoms), that the president is the proverbial wolf
in sheep’s clothing?

If Obama is not really
the sincere and focused Democrat that we supported, that could explain why we’re
so disappointed and dispirited and why current polls suggest that his lead over
Mitt Romney, the presumptiveRepublican
nominee, is minimal at best?

Schneiderman responds.

Daily News headline

Attacking the foreclosure crisis

A week after the
publication of the Gecan and Graff op-ed, Attorney General Schneiderman replied
in the same forum with his own op-ed in the New York Daily News entitled,
“Attacking the foreclosure crisis.”Schneiderman’s rebuttal might have reminded readers that in their
article, Gecan and Graf called on the attorney general, who they emphasized“has acted boldly and honorably,” to resign
from Obama’s “cynical arrangement.” They appealed to him to “go back to working
effectively with fellow attorneys general in Delaware, Massachusetts and
Nevada.”

Without specifying the
authors by name, or mentioning their op-ed, Schneiderman explained that he was
writing to correct recent “mischaracterizations” of the mortgage backed working
group. Schneiderman reminded readers that$7 trillion was lost in household wealth when the housing bubble burst.

As evidence of the
president’s purposeful action, Schneiderman pointed to the administration’s
request for an additional $55 million “to ensure that we have the resources to
do a thorough job.” But this assertion, if anything, seemed to weaken his case.
First of all, the appropriation must get through the House of Representatives,
and if past is prologue, a wink and a nod from the White House will be more than
sufficient, if necessary, to ensure that the Republican led House won’t pass
such a measure even if they trouble to take it up. Moreover, if Obama was
serious about adding such funds, why weren't these funds mentioned in January?

More directly rebutting
Gecan and Graff's information, Schneiderman claimed“more than 50 attorneys, investigators and
analysts have already been deployed to support our investigations, with many
more on the way.” Yet, once again, Schneiderman’s assertion raises more
questions than it might seem to answer.

Skeptical readers might
wonder if these new personnel actually exist, and if they do, have they been
specifically attached to Schneiderman’s task force?If so, were they deployed only in the last
week, or have they been working on the issue for weeks if not months? In the
latter case, why then did Schneiderman tell Gecan and Graf a different story in
March and April?

In his op-ed,
Schneiderman references an additional $15 million in funds from the “settlement”
that his office succeeded in obtaining “to expand legal services and housing
counseling” that were otherwise set to expire on April 1. Now, he writes, these
services will be available for three more years.

Readers could be forgiven
for wondering if the $15 million in presumably new money was sufficient to get
Schneiderman on board to front for a president who once more has shown little
action. Obama’s eloquence seems intended to mask his bewildering indifference to
the trillions in homeowner losses and the consequent effects on the larger
economy.

The episode is a reminder
that an inspiring element of the Kennedy administration was the sense that it
intended to unleash the talents and energy of the most dedicated Americans in
many fields, not least in politics. Today,
as we head deeper into election season, we watch while President Obama
seems to block the efforts of a spirited public servant and turn him into a
party apparatchik.

Unfortunately it will
take more than ringing pronouncements to convince us that the president
and attorney general Schneiderman will make much progress as they attack the
foreclosure crisis.

***

NB: For a distinctly less
flattering analysis of Schneiderman’s independence on the mortgage crisis
issue, see nakedcapitalism. com, April 23, 2012..

"The Ministry of Truth
Speaks: American Prospect Tries to Pass Off Mortgage Turncoat Schneiderman as
Hero"